What You Should Know Before Renting Your Home on Airbnb

If you’re looking to make a few extra bucks and you travel a lot or have a spare bedroom you’re not using you may have considered renting out your home when you’re not around. It’s a simple idea, and many people are already doing it through Airbnb. Make sure you consider all aspects of renting your home on Airbnb before you sign up though.

What is Airbnb?

If you’re unfamiliar with, or have never heard of Airbnb, it’s a website which allows people around the globe to rent out their homes, apartments, or even their spare bedrooms to people traveling through the area. Basically it’s a glorified version of couch-surfing.

There are other similar sites, such as HomeAway, Roomorama, and VRBO, but these seem to focus mostly on vacation rentals from people who own secondary homes. Currently Airbnb has 350,000 hosts in 190 countries.

Listing your home

When it comes to actually listing your space on Airbnb’s website, the process is simple, easy, and free. However, on their site Airbnb makes sure to warn hosts to gain a full understanding of how their city’s laws work.

“Some cities have laws that restrict your ability to host paying guests for short periods,” it says on Airbnb’s website. It continues to say in some tax jurisdictions, Airbnb will calculate, collect, and remit the local occupancy tax on your behalf.

Joseph from Indianapolis was new to Airbnb and made sure to consult with his attorney before listing his home.

“I already had an attorney, but it’s never a bad idea to be sure you have your legal questions answered,” Joseph said.

Another renter, Peter from Central Indiana, added, “I work with my local county and federal tax service to pay what is required.”

If you have legal questions about listing your home, how taxes work, or whether you can list, make sure you consult a professional.

Are there any fees?

Guests pay the cost of your listing in addition to a 6-12% guest service fee, which is why they see a price higher than you originally quote them. So your overall payout will be the listing price minus the 3% host service fee.

As for out of pocket costs to you, it’s recommended you supply your renters with a few amenities and clean the space before and after each renter. If you don’t have time to clean, you’ll have to pay for a cleaning service which would be an additional expense. You can always up your rental price though.

“Because I have rented for so long, I have worked hard to stock the place with as many amenities as I can,” Peter said. “I have asked my guests through the years what they would like to see in the apartment, so that has helped me know what to stock.”

Joseph added, “We stock the house like a hotel, but most people bring the essentials with them. The cleaning lady is in charge of keeping everything clean and stocked.”

How to cope with strangers in your home

The biggest concern for many with renting your home is the fact there’ll be strangers in your home which means potential damage or thievery.

“It can be anxious having strangers come through often, but most everyone has been great so far,” Peter said.

Airbnb does have a host guarantee protection for up to $1,000,000 to a host for damages to covered property. Although Airbnb offers this protection, which is not a replacement for insurance, there haven’t been many instances where it’s needed.

“The experience has been great overall. Generally my guests have left the place in great shape, with a few exceptions,” Peter said. “Some wash all their dishes and put them away, some leave the dirty dishes in the sink. Some leave the bed unmade and others will practically remake the whole bed…It just depends on personality.”

If you were to feel uncertain about a guest, you do have the ability to approve or deny a guest. You can even ask them as many questions as it takes for you to get comfortable.

Think about it

There are many ways to make a few extra bucks, like hosting a garage sale, or selling some old items on ebay, but put some thought into whether renting your home would be a good option. It doesn’t even have to be your full home, it could just be your spare bedroom.

The plus sides, according to Peter are, “Income and meeting new people.”

Would you consider renting your home?

Names have been changed to protect the identity of those individuals who so willingly answered our questions regarding their Airbnb experience.